Front Steps Slips and Falls
As the nonprofit that runs the ARCH falls apart, the city’s rush to replace it frustrates providers
By Austin Sanders, Fri., July 29, 2022
The staff members employed by Front Steps – the nonprofit that has operated Austin's Downtown emergency shelter, the Austin Resource Center for the Homeless, since it first opened its doors in 2004 – learned that the city of Austin would cancel all contracts with the nonprofit in a number of ways. None of those ways offered much dignity to the overworked and underpaid nonprofit staff.
Only a few learned the news directly from the Front Steps Board, even though its three directors had engaged in April conversations with Austin Public Health about the organization's future, and had received the termination memo sent from APH to the board on July 1. Members of the nonprofit's leadership team found out about the looming contract terminations – which could force the 25-year-old nonprofit to shutter entirely – on the afternoon of July 15, either shortly before or at the time the Chronicle published a story breaking the news. Those leaders did not have enough time to inform the rest of the organization's staff.
Some Front Steps staff learned of the city's decision by reading our story. Some of its case managers, who work directly with people in Austin living without shelter to get them into stable housing, learned the news from their clients. Those confused and anxious clients left voicemail messages asking to know more, but staff had no information to provide other than our July 15 story.
It wasn't until the afternoon of July 19 that the nonprofit's staff had a chance to hear directly from the board. During a four-hour Zoom meeting, a recording of which was provided to the Chronicle, about 50 staffers unloaded on the three board members – mostly on President Haggai Eshed, who sat stoically as staff pelted him with their frustrations and intense emotional responses to the news.
"My frustration is that I had my staff calling me to tell me it was their clients informing them of [the contract terminations]," a woman who works in client services said. (Though the Zoom recording includes the names of speakers and many identified themselves before speaking, we have decided not to publish any employee names to respect their privacy.) "That was a horrible way for my staff to find out … It could have been handled differently and I am very frustrated and upset." (A statement sent by a spokesperson at Adisa Communications, a professional PR firm hired to handle internal and external messaging for the Front Steps Board, reads: "We did not move quickly enough to notify staff at Front Steps. We regret our delay and we've committed to timely, transparent communication.")
Others were more blunt with Eshed. "Haggai, no one wants to work with you," one woman said. "How can we say this any other way? No one wants to work with you … so please give us an answer as to when you are leaving." (Eshed's response during the meeting: "No comment.") This was not the first time Eshed and the other two directors, Tenille Carpenter and Sabelyn Arden, had been asked this; earlier this year, a group of staff members wrote to Eshed demanding that vacant board seats be filled and an interim executive director be hired – or that the board resign.
According to our interviews with seven current or former Front Steps employees, all of whom the Chronicle has agreed to grant anonymity due to their continued employment at Front Steps or at one of the homeless service providers that works alongside it, nothing was done to meet those demands. In fact, several of our sources believe the staffer who delivered the letter to Eshed was fired for doing so. (When asked about this allegation, the Adisa spokesperson issued a response that would be repeated for several of our questions about allegations against the board and former Front Steps ED Terra Harris: "The Front Steps Board of Directors is not authorized to respond to questions regarding employees.")
"I hope you never have the opportunity to be a leader again," one male staffer said during the Zoom meeting. "You are going to go on and be able to make rent. Us on the front lines, we can't even make rent. I don't make enough at Front Steps [to pay rent], but I've been here for two years 'cause it's about the clients."
This staffer reflected a sentiment – deep concern for the clients most at risk by the potential closure of Front Steps – common among the employees speaking out at the town hall, many of whom could not, or did not want to, hide the fury and hurt they were clearly feeling. "Sitting here as a client advocate … I have to advocate for my clients," one woman said, before describing the difficult task Front Steps case managers face in building relationships with their clients – a vital step on the long road to helping them attain stable housing.
"I've met with grown men who shed tears with me after sitting at Front Steps for eight months [waiting for a case manager], when the contracts call for them to have one assigned after two weeks," the woman continued. "They're going to fall through the cracks again for months before they get help. I'm angry for them, because it takes time before we can help somebody. … I love Front Steps and have been through many fights with leaders here, because I love advocating for my clients."
Stumbling, Falling Short
It is unclear exactly when and why APH made the painful, even if necessary, decision to cut ties with Front Steps. The July 1 staff memo to Council (also sent to the Front Steps Board) cites many reasons: problems with governance of the nonprofit, stemming from leaving too many vacant seats on the board; consistently poor leadership, including an apparent inability for the board to find even an interim ED, let alone a permanent leader; and repeatedly inconsistent and late reporting to the city on performance metrics. (See "Lagging Performance at Front Steps," below)
Our conversations with people who currently work at Front Steps, worked there in the past, or who work at partner agencies that interact with staff at Front Steps bear out many of these concerns. Currently, the board has a president, a treasurer, and one director, which the Adisa spokesperson said means the "Board of Front Steps has been in good standing," citing a section of the Texas Business Organizations Code that requires nonprofits "have at least three directors, one president, and one secretary." After the departure of the last two EDs, the board has been unable to retain even an interim ED. Jim Ward, a well-respected provider now at the Texas Homeless Network, accepted the interim ED position at the end of March. He reportedly left after less than a week.
A common complaint about Front Steps leadership is that it was often indifferent, or outright hostile, to attempts to usher in new ideas or even just to perform the basic tasks required to help clients. Because Front Steps has suffered high turnover among its middle managers, most of those interactions were with Harris and Eshed, both of whom assumed their roles in 2021. But several who had worked under Harris' predecessor Greg McCormack (who now works in the city's Homeless Strategy Division) say it was not much different then.
One former staffer recalled a meeting in which he pitched an idea to Harris and her leadership team aimed at streamlining the process that led people who reserved a bed at the ARCH into case management. The staffer said his immediate supervisor supported the idea, which aligned with the retooled model for the ARCH launched in 2019 that requires guests at the shelter engage with case management. Harris, apparently, didn't think much of the idea, because it didn't go anywhere. Later, the staffer said, when he brought up the idea again, Harris appeared not to recall it – though she said it sounded like a good idea. "Upper management, like Harris, were just unprepared, very removed from the experience of dealing with the high-needs population at the ARCH," the staffer told us. "But the same was true of Greg [McCormack] and Trey [Nichols, director of shelter operations for Front Steps from 2014 until earlier this year]."
Another former Front Steps employee said that indifference from leadership sometimes threatened the ability of staff to serve clients. At one point during her time at the organization, she was the only person certified to manage Front Steps' share of a pool of city funds known as Best Single Source Plus (BSS+). These funds are valuable to case managers, because they can be used for more than just rent. Despite her efforts to convey to Harris the importance of hiring or training others to use BSS+, she remained the sole manager of funds for dozens of clients. "It took a huge toll on my mental health," the employee said of the weight she felt from this responsibility.
Other employees simply described Harris as unprofessional, manipulative, and demeaning. They agreed that she did not appear to be qualified for the job, and with the board not providing any real oversight, they felt they didn't have anywhere to turn with their concerns. (At the Zoom town hall, a human resources employee claims to have spoken out about issues "for months and months" before being told that if she had complaints, she should take them to the Texas Attorney General.)
Harris, hired as Front Steps ED in February 2021 and terminated by the board this past March, told the Chronicle it was "never her intent to demean anyone" and that as a "change agent" within the organization, she did not feel welcomed by some on the front lines or in leadership. As for characterizations that she was unfit or unprepared to serve as ED of a nonprofit that maintains a multimillion-dollar annual budget, she obliquely referred to racism as the motivation for those descriptions. "'Not a good fit' is concerning terminology to use," Harris told us. "You don't often see a lot of Black leaders in executive director positions at nonprofits. So, was that maybe the problem?" (Employees who spoke to the Chronicle reject this charge, saying their objections were purely based on her conduct and performance.)
According to a 2019 fundraising flier for Girls Inc. of Delaware, an affiliate of a national nonprofit that is listed on her LinkedIn profile as Harris' most recent leadership role before Front Steps, the organization had annual revenues of around $675,000 with 8 to 12 full-time employees. Front Steps, on the other hand, managed millions of dollars from its city contracts alone, and at one point employed at least 191 staffers, according to its IRS Form 990 filed for its 2019 tax year.
Harris had her own difficulties with the board, describing power struggles with Eshed and times in which the board "overstepped" its authority. One issue of particular concern to her was that Front Steps lacked any kind of internal data tracking system, other than Excel spreadsheets, of how funds were being used to assist clients. Rather than tracking the data internally, Harris said Front Steps would typically input data directly into Austin's Homeless Management Information System – the database shared by all homeless service providers in the city and county to track client care and report funding use to governmental authorities. (Our conversations with Front Steps employees corroborate Harris' claims that data tracking was a consistent problem.)
"I was surprised that a 25-year-old organization was using no other program outside of HMIS to track data," Harris said. "I would ask for data and look at it and it would not always be reconciled. How could we be accurately measuring outcomes and approval of expenditures?" Conversations with other homeless service providers indicate that it is not entirely unusual to track data in this way, but many cited difficulties with using HMIS that were not always easily resolved, which motivated them to use their own internal databases as a backup.
Harris says she pushed for the organization to adopt better data management practices but couldn't get buy-in from the board. Harris also noted this was when Austin was still deep into COVID and trying to deal with the new camping ban, so she speculated that it may have been a lower priority compared to other issues.
Somebody, Anybody, Help
With fresh scrutiny on how Front Steps has run the ARCH – and, to a lesser extent, the Southbridge shelter, which offers hotel rooms to unhoused people while they work with case managers on longer-term housing plans – stakeholders within Austin's homeless response system hoped that APH's parting ways with Front Steps, though painful and disruptive, would create an opportunity to rethink how its programs are run and how they're funded.
But when APH convened eight of Austin's top homelessness responders – Austin Area Urban League, the Ending Community Homelessness Coalition (ECHO), Caritas of Austin, Foundation Communities, Integral Care, Sunrise Community Church, The Other Ones Foundation, and Family Eldercare – and one relative newcomer to the scene (Urban Alchemy, based in San Francisco), it quickly became clear that the city wanted continuity rather than change, and for the ARCH to remain the Downtown congregate shelter that it's been for nearly two decades.
That's understandable; more than 3,000 people live without shelter in Austin on any given night, with at best 300 emergency shelter beds available to them. Continuing to meet that need is important. But the groups gathered by APH were given 24 hours to decide whether they wanted to pursue either the ARCH or Southbridge contract before submitting a "letter of intent" to APH – a kind of slimmed-down application the city uses for emergency contract procurement.
People involved in the conversations with APH say the information the city provided about performance expectations and funding sources was unclear, which discouraged some from applying. In the end, just three organizations submitted a letter of intent for the Southbridge contract (Urban League, TOOF, and Integral Care) and just one organization bid on the ARCH contract – Urban Alchemy.
The Choices at Council
So APH has offered the Southbridge contract to the Urban League (not to exceed $4.2 million for a 13-month term) and the ARCH contract to Urban Alchemy (not to exceed $4.1 million for a 13-month term), to be approved by City Council at its meeting today (Thursday, July 28). APH wants to have agreements executed with each organization by Aug. 15 so they can work with Front Steps on transition plans before its city contracts terminate on Sept. 30. It is unclear how current Front Steps staff factor into these transition plans; in a statement, APH said both organizations were "eager to speak with Front Steps staff" and have "indicated … they are open to retaining staff." But, the APH spokesperson added, "while the City of Austin does not control the hiring processes of any nonprofits assuming activities currently carried out by Front Steps, staff will facilitate conversations between organizations to explore potential transfer of employees."
Both decisions have surprised other homeless service providers. The Urban League, though a respected Black-led justice advocacy organization in Austin, has no experience running anything like an emergency shelter. The Southbridge shelter has 75 rooms available for guests, all of whom come into those rooms directly from the streets or encampments as part of the city's HEAL (Housing-Focused Encampment Assistance Link) initiative. Many are dealing with mental health or substance abuse issues that require shelter staff to be trained rigorously in conflict management and de-escalation techniques, to ensure guests and staff remain safe and comfortable without needing to involve the police.
For years, the Urban League has administered Home Repair grants, a federally funded displacement prevention program that helps keep people in their homes by paying for needed repairs. More recently, they were awarded federally funded emergency housing vouchers, which do not cover the supportive services services that some may need to remain in stable housing, even at Southbridge. It is unclear how many vouchers AAUL received or has used, but it's the first time AAUL has been tasked with managing housing placement. Representatives with AAUL did not respond to questions from the Chronicle before we went to press.
Urban Alchemy mostly operates in Los Angeles and San Francisco, but dipped a toe into Austin earlier this year when it was one of three organizations chosen in April to share a $2 million St. David's Foundation grant (administered by ECHO) and form a new Austin Street Outreach Collaborative. Service providers were surprised that UA won the grant, as it had no footprint in Austin and 22 other agencies applied. The Homelessness Response System Leadership Council, which advises ECHO and which crafted the scorecard used to award the street-outreach grant and ultimately chose the winners, was also surprised by UA's application – it was the only out-of-town organization to apply.
Since then, according to interviews with people involved in front-line services and street outreach, Urban Alchemy hasn't had much of a presence in Austin. It has three people in town, who by all accounts appear to be dedicated and hardworking and occasionally run supplies to people living in camps. But they are not yet doing the kind of outreach the ASOC seems designed to provide – like performing Coordinated Assessments, one of the first steps an unhoused person must take before being enrolled in a housing program. ECHO says Urban Alchemy is still staffing up and training others before hitting the ground on that work (a spokesperson for UA declined to answer our questions until Council approves the group's ARCH bid).
We Can Now is one of the other two groups sharing the ASOC grant. Anthony Jackson, founder of We Can Now, has been working most closely with Urban Alchemy; he told us that while he hasn't seen them on the streets much, he has met with their staff in Austin a number of times to help give them a lay of the land and to talk strategy. "Being from California and not knowing anything about Austin or the landscape, it's going to take as much time as [UA] needs to get acclimated," Jackson told us. "I can only imagine how hard it would be to show up in a place you've never been before and go do outreach."
Most people we talked to didn't have a problem with UA winning the ARCH contract despite having no footprint in Austin; it at least has relevant experience running emergency shelter programs in California. Many also admired the nonprofit's mission of connecting formerly incarcerated people with jobs. Urban Alchemy has not operated an actual congregate shelter like the ARCH, however; it's run some sanctioned campsites and parking grounds, and what California refers to as "shelter in place" hotels (or SIPs) – akin to Austin's Protective Lodging program to protect the unhoused from COVID-19, which later transformed into the bridge shelter program that includes Southbridge.
Taking a "Calculated Risk"
However, there's a lengthening list of troubling stories involving Urban Alchemy, which has experienced explosive growth since its founding in 2018, thanks in part to winning a number of no-bid emergency contracts in California, worth tens of millions of dollars, throughout the pandemic – contracts that did not go through a competitive bidding process, like the ARCH contract. Red flags include an alleged sexual assault by a UA staffer at a SIP hotel in San Francisco and criticisms from labor leaders that UA failed to provide adequate training to its practitioners.
But a story published June 1 in the Pacific Sun, an alternative weekly in Marin County, that details allegations made by residents of a UA-run sanctioned encampment in Sausalito (directly across the Golden Gate from SF) has been most troubling to local advocates. The story details alleged sexual assault and harassment of residents by staff, some of whom both used drugs on the job and provided drugs to residents. Homeless advocates in Sausalito called on city officials to cancel the UA contract early, but that didn't happen, though it has now expired (advocates are now waging a legal battle against the city over the allegations).
City government leaders, including San Francisco Mayor London Breed and Sausalito City Manager Chris Zapata, tend to praise the work UA has done in their cities. At an Austin City Council work session Tuesday, July 26, APH Director Adrienne Sturrup said she had talked with Zapata, who said when one of the allegations was brought to the attention of Sausalito officials, they notified UA, which "addressed it immediately," and that Zapata "had no further concerns."
When the Chronicle asked APH about these allegations, a spokesperson said in a statement that "APH has rigorous contracting standards and upholds grantees to the terms and conditions included in its boilerplate and standard exhibits." The statement goes on to list all of the due diligence APH performs on grant recipients: a review of the organization's governance and board of directors; confirmation "that the organization is able to contract with the City of Austin, State of Texas and Federal government," does not owe past taxes to the city, and is current on payroll taxes; and has submitted all its tax documents to the IRS. On questions relating to legal allegations against UA, APH deferred to the nonprofit itself, who declined to respond.
ECHO's Leadership Council, frustrated with how APH handled the solicitation process, sent a letter to Mayor Steve Adler and Council outlining its concerns. "We are dismayed that these decisions and the specific processes and plans surrounding the termination of these contracts were not made in consultation with [us]," a draft of the letter we obtained reads. "Decisions of this scale … must intentionally engage with the Austin-Travis County community of service providers, and seek advice as to the best ways to prevent harm, and promote a unified, collaborative, and efficient homeless response system."
The letter includes several asks of APH and Council as they proceed with new operators for the ARCH and Southbridge. Those include offering current Front Steps employees right of first refusal on jobs at the new agencies running either shelter; allowing the Leadership Council to provide oversight on how the new contracts are implemented; and engaging with stakeholders on a "long-term plan … to assess our current citywide shelter plan, and to reimagine the design, scope, and funding of Austin's shelter system."
If Council awards the ARCH contract to Urban Alchemy at its meeting today, APH will carry out annual financial audits, review the group's HR policies, and require a "client grievance policy" that would be visible upon entering the shelter. At the Council work session, Sturrup also said the city could write "regular checkpoints" into the contract with UA "to catch and address any issues as they arise."
Ultimately, Sturrup told Council, she understood that contracting with UA was a risk. "But it's a calculated risk."
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